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While the exact origin of the biscuit is uncertain, the traditional Dutch belief links the pepernoten to the feast of Sinterklaas, celebrated on December 5 in The Netherlands and December 6 in Germany and Belgium. This is when children receive gifts from St. Nicholas, who is partially the inspiration for the Santa Claus tradition. In Germany, the pfeffernüsse is more closely associated with Christmas. The biscuit has been part of European yuletide celebrations since the 1850s.

The name peppernut (pfeffernuesse, peppernoder etc.) does not mean it contains nuts, though occasional varieties do. The cookies are roughly the size of nuts and can be eaten by the handful, which may account for the name.[5]

Throughout the years, the popularity of the pfeffernüsse has caused many bakers to create their own recipes. Though recipes differ, all contain aromatic spices - most commonly cinnamon, cloves, and anise. Some variations are dusted with powdered sugar, though that is not a traditional ingredient. Molasses and honey are also used to sweeten [6] the biscuits.

For the dough, most versions still use 19th century ingredients such as potash (potassium carbonate) and ammonium carbonate as leavening agents to get the sticky and dense consistency of the original mixture. It is then either kneaded by hand or through the use of an electric mixer.[7]

The pfeffernüsse is commonly mistaken for the kruidnoten or spicy nuts in English. While they are both famous holiday biscuits, the kruidnoten is harder, has a lighter brown color, and has a different shape. Its ingredients are more similar to the ones used in making speculoos.

Russian tea cakes are also confused with the pfeffernüsse, especially when dusted in powdered sugar. In this case, the pfeffernüsse biscuits are more bitter than the Russian treats because the ingredients of the pfeffernüsse are less refined.